Can Environmental Regulation Promote Green Innovation and Productivity? The Moderating Role of Government Interventions in Urban China

Innovation policy and ecological welfare performance: evidence from a quasi-natural experiment of China

The National Innovative City Pilot Policy (NICPP) is a policy implemented by the Chinese government to create an environment conducive to innovation, optimize industrial structure, promote economic development, and stimulate green innovation. The impact of this policy on ecological welfare performance is a question worth exploring. Based on panel data from 285 cities from 2007 to 2021, this paper uses the multi-period difference-in-difference (DID) model, propensity score matching method, and spatial DID model to study the impact of NICPP on ecological welfare performance and spatial spillover effects. The results show that (1) NICPP can significantly improve ecological welfare performance. (2) The mechanism analysis found that NICPP mainly improves ecological welfare performance through technological innovation investment, industrial structure upgrading, and increasing government attention. (3) The heterogeneity analysis found that NICPP has a more substantial driving effect on the ecological welfare development of cities in the eastern and western regions, cities with higher administrative levels, and cities with lower secondary industry agglomeration. (4) Further research has found that NICPP not only promotes the development of local ecological welfare but also has a positive spatial spillover effect on the ecological welfare performance of neighboring regions. This paper enriches the research on the effects of NICPP and provides policy references for the sustainable development of cities.

The spatiotemporal effects of environmental regulation on green innovation: Evidence from Chinese cities

Environmental regulation is expected to stimulate green innovation for the promotion of urban sustainability, while the effectiveness of this stimulus has long been debated under the Porter hypothesis and the crowding out theory. Empirical studies under different contexts have not reached a consistent conclusion yet. Based on the data of 276 cities in China from 2003 to 2013, this study captures the spatiotemporal non-stationarity in the effects of environmental regulation on green innovation with the combination of Geographically and Temporally Weighted Regression (GTWR) and Dynamic Time Warping (DTW) algorithm. The results show that environmental regulation has an overall U-shape impact on green innovation, indicating that the Porter hypothesis and the crowding out theory are not in conflict, but are theoretical interpretations of different stages of local responses to environmental regulation. Specifically, the effects of environmental regulation on green innovation present to be diverse in patterns that include enhancing, stagnant, undermining, U-shape, and inverted U-shape. These contextualized relationships are shaped by local industrial incentives and innovation capacities of pursing green transformations. The spatiotemporal findings allow policymakers to better understand the multi-staged and geographically diverse impacts of environmental regulation on green innovations, and formulate targeted policies for different localities.

The Influence of Government Regulation on Farmers' Green Production Behavior-From the Perspective of the Market Structure

To clarify the factors influencing the green production behavior of peach farmers, this paper uses the survey data of 741 peach farmers in 19 provinces and cities in China, it uses a multiple ordered probit model to empirically analyze the impact of the government regulations on the green production behavior of peach farmers, from the perspective of the market structure. This paper also analyzes its intermediary role in this process, and it analyzes the possible heterogeneity at both the planting scale and the regional level. The results show the following: (1) Government regulation has a positive and significant impact on the green production behavior of peach farmers. Specifically, government supervision and inspection, alongside green subsidies, can positively promote the implementation of green production behavior by peach farmers, but government publicity and training have not played a good role. (2) The market structure plays a partial intermediary role, rather than a complete intermediary role, in the government regulation affecting the green production behavior of peach farmers. (3) The impact of the government regulation on the green production behavior of peach farmers is heterogeneous. Specifically, compared with small farmers, the impact on large-scale farmers is higher; however, the influence of the three methods of government regulation on the green production behavior of peach farmers varies from region to region. Therefore, in order to promote the implementation of green production, the government should introduce appropriate local policies, strongly support new agricultural business entities, draw clear guidelines for the market, and play the role of "night watchman".